In what could be the first such move in the nation, the Los Angeles City Council Wednesday will consider creating an ordinance banning campaign contributions from real estate developers.
The proposed changes would also include a ban on political donations from non-individuals and on “behested” payments made to a charity or government program at the request of an elected government official. It would be the first ban on developer donations by any jurisdiction in the country, according to City Ethics Commission staff.
The latest motion was introduced following a November 2018 FBI search of Councilman Jose Huizar’s home and offices. He was also named in a search warrant related to the FBI’s probe of possible bribery, extortion, money laundering and other crimes as part of a corruption investigation at City Hall focusing on huge real estate investments from Chinese companies. No one has been arrested or charged as a result of the investigation.
The Ethics Commission backed the changes in February, and a city council committee moved the proposal forward in April. The committee’s direction was that the city attorney draft two ordinances, one based on the Ethics Commission recommendations and one based on the City Council motion.
The two options have slight differences, including that the motion would include elections for the Los Angeles Unified School District and have different definitions for developers and behested payments. Councilman David Ryu, one of the proposal’s main backers, wrote a letter asking the committee to consider the City Council motion in addition to the Ethics Commission’s recommendations.
Under the guidelines recommended by the Ethics Commission, non-individuals would be prevented from contributing to city elected officials and candidates, and developers needing discretionary approval from the city would be restricted from making political contributions from the date the application for the property is filed until 12 months following the final resolution of the application.
City law limits contributions from non-individuals, with the charter stating candidates may not accept more than certain total dollar amounts from non-individuals, adjusted annually to reflect changes in the Consumer Price Index. The current maximum is $226,500 for City Council candidates.
The Ethics Commission guidelines on a ban on non-individual and developer contributions would also apply to contributions to any committee controlled by an elected city official or a candidate for elected city office, and would also prohibit them from fundraising and bundling, meaning they could not collect large amounts of other people’s money and deliver it to an elected official or candidate.
Among the amendments added by the city council committee was that the Ethics Commission hold town hall meetings to get feedback from campaign treasurers and charitable organizations on how the changes would impact their operations. Ethics Commission staff would also be directed to develop a database on developers that would be covered under the new rules.
Under the recommended Ethics Commission guidelines, behested payments would be banned by “restricted” sources, which includes a lobbyist, a lobbying firm, a bidder, a contractor, a person who attempted to influence the elected official in the previous 12 months and developers.
Of the 10 payors who were reported as having made the most behested payments over the past five years, eight had business with the city during a recent five-year period, according to Ethics Commission staff.
The behested payment ban would include several exceptions, including payments that are solicited because of a state of emergency.
The ban on non-individual contributions would require voter approval, Ethics Commission staff told the committee.